The expectation of travelling to Mexico City
always brings to one's minds the idea of a bustling, modern and busy
capital. It also brings to mind the history of this city, its impressive
buildings, its Museum of Anthropology, with objects reminding us of the
rich Aztec culture, its temples and mythology.

This is my first visit to Mexico since I took
office as Director General of the WTO in September 2005, and I am very
pleased to be here. I have come to tell you about the negotiations of
the Doha Round and to ask for your support. We are at a crucial moment
of the negotiations, and I need all the support I can get — primarily of
countries like Mexico. And I am sure that some help from the Aztecs Gods
of nature, rain and agriculture, whose beautiful images are displayed in
that Museum, would do us no harm.

Since its launching in Doha, Qatar, in 2001,
these negotiations have not been an easy endeavour. But we have been
learning a lot in the process, and I am convinced — looking back with
the advantage of critical distance — that events such as the Cancun
Ministerial Conference, in 2003, have had a positive effect to the
potential outcome of the Doha Development Agenda. What can be achieved
today is more balanced and at the same time more substantial than what
was proposed four years ago — but it was necessary to go through those
events. We have learnt quite a lot in the process, with the milestones
of the July 2004 framework agreement, in Geneva, and the results of the
Hong Kong Ministerial Conference in December 2005.

The suspension of the negotiations in July of
last year imposed on us all a period of reflection which, is retrospect,
was also important to safeguard the achievements of the past years. And
then, in January of this year, we were able to resume the negotiations
in full mode. This shows that our Members are still confident in the
potential of the Round. But it should be clear that some difficult
trade-offs and technical work remains to be done in the near future.

Current Developments

Since February, the negotiations have resumed
in full mode in all negotiating groups. Members are also working
bilaterally, touching base and checking the impact of possible
compromise numbers on products of their major export interests and main
import sensitivities. There is also renewed engagement and support at
the highest political level. Over the last few weeks, the US, EC, Brazil
and India have held bilateral contacts in London and Geneva at
Ministerial level. The day before yesterday, in Jakarta, from where I am
now arriving, a group of Ministers from developing countries met to
discuss specific issues on Agriculture. On my side, I have been having
separate meetings with many ministers — including with Secretary Sojo
this morning — on numerous occasions since the resumption of the
negotiations. From all of these meetings, in different formats and
configurations, I know that some progress has been achieved in testing
hypothesis, approaches and formulae.

While this can be helpful in contributing to
the advancement of the negotiations, it is taking place at too slow a
pace. Time is not on our side, and many WTO members are becoming
increasingly impatient. The multilateral process of negotiations must
therefore kick-in at full speed, and the Chairpersons of various
negotiation groups must come into the centre stage. We need to speed up
the process so as to grasp the window of opportunity which closes at the
end of June with the expiry of the US Trade Promotion Authority.

The potential of the Doha Round

I would now like to refer briefly to the main
issues under negotiation. Three issues are at the forefront of the
discussions at this moment: agricultural subsidies, agricultural tariffs
and industrial tariffs. Work is also on-going on trade in services to
prepare the improved offers that each country should table in order to
be ready for negotiations on the specifics of further market opening.

Furthermore, there is work in the areas of
Antidumping, Subsidies — including Fisheries subsidies, Trade
Facilitation or Trade and Environment, with development being like a red
thread through all of them.

Starting with agricultural subsidies. What is
already on the table today is pretty impressive, albeit not enough to
lead us to the final success. In this part of the negotiations, the ball
is very much in the court of the United States. The US must offer deeper
cuts in its agricultural subsidies beyond its current proposal. Other
countries will then follow suit.

One word on export subsidies. It should not be
forgotten what has already been achieved, but is pending the final
conclusion of the Round: the elimination, by 2013, of the most damaging
type of subsidies, the agricultural export subsidies. A substantial part
of them should already be gone by 2010, according to the agreement
already on the table. I should say that there are also some important
remaining issues in the export-subsidy part of the negotiations, like
export credits or the rules on state-trading enterprises.

On agricultural market access, it is mainly
for the EU and the G-10 (including countries like Japan and Korea) to
agree on greater cuts in tariffs and enhanced access to their internal
markets, beyond their current positions. Also on this part of the
negotiations, India and the G33 — who were meeting in Jakarta this week,
as I mentioned — must also make a contribution. They need to ensure that
the special protection, which has been already secured for their most
sensitive agricultural products, does not negate the overall objective
of providing increased market access opportunities, as agreed when we
launched the Round in 2001.

As far as industrial tariffs are concerned —
this is the area we commonly call NAMA, or non-agricultural market
access — the expectation is to see large developing countries, amongst
which some of the members of the G20, like Brazil, India and Argentina,
to agree on cuts in their import tariffs. Again, the necessary
flexibility will be considered for some products, but the idea is that
industrial tariffs are cut automatically, according to a new technology
called the Swiss-formula, which cuts more on the high tariffs and less
in the lower ones.

These are only the main areas in the
negotiations, the locomotives of the a train the has many other (and no
less important) wagons, such as services — of special interest to the
Mexico —, rules on antidumping etc, as I mentioned above, which await a
push to move into the final destination.

What's in it for Mexico ?

In a country whose foreign trade is largely
covered by an impressive network of preferential agreements — according
to the notifications made to the WTO, Mexico has some 12 free trade
agreements with 44 countries — one could rightly ask: why do we need the
multilateral trading system, what's in it for Mexico in these
negotiations ?

There are many answers to that question, but
the one, most direct one is: because the WTO and its rules provide
stability to all of its Members, because the WTO is the basis of
international trade. The very concept of “preference” of bilateral or
regional agreements is constructed on the assumption that there is a
basis — and the preference is only the “plus”. The basis is the
multilateral system provided by the WTO.

In more practical terms, and going directly
into a issue of specific importance for Mexico, the WTO is the only
international forum where government subsidies are disciplined — and
commitments to reduce them are undertaken. For a country like Mexico,
which has opened or is opening its borders to imports of many products
under preferential agreements, the WTO and the current Round are the
only forum where agricultural subsidies granted by major developed
countries can be tackled.

The same can be said about trade remedies.
Multilateral rules on antidumping, anti-subsidies, as well as safeguard
measures are of utmost importance in a country which has liberalized its
trade regime. Mexican authorities have understood this and have
strengthened their investigating mechanisms. The improvement of rules on
antidumping is hence another area of specific interest for Mexico.

In Services, an area of growing importance for
several large developing countries, Mexico has potential gains in
several sectors (audiovisual, computer services, construction and
engineering) and has been playing a constructive role in the
negotiations — not least through the chairmanship of Ambassador Fernando
de Mateo. Of specific interest to Mexico is also the so-called Mode 4
issue, which deals with the provision of professional services by
individuals in foreign markets.

Another area of specific interest to Mexico is
Dispute Settlement. Mexico has been one of the most active Members of
the WTO in trade disputes, having started 17 cases and being the
respondent in 14 of them. The last request of consultations by Mexico
(with China on export subsidies) is a good example of the fact that
there is no replacement for the multilateral trading system, even for
countries with a vast array of bilateral agreements. I should also
mention Mexico's very active participation in the negotiations to
improve the rules on dispute settlement. Mexico's competence, initiative
and authority in these talks are recognized by all and much appreciated.

To sum up, the current negotiations are of
both a systemic and specific trade interest for Mexico. In systemic
terms, Mexico will benefit with improved, more stable and balanced rules
and disciplines, in particular in Agriculture, Antidumping and on
Dispute Settlement. In addition, the current negotiations have the
potential of new market opportunities for Mexico's goods and services
exports.

Conclusion

The Doha Development Agenda is the biggest
challenge for the WTO since its creation in 1995. It is a challenge to
achieve what was started in the Uruguay Round: a more level playing
field in areas of particular interests to developing countries, such as
agriculture. It is a challenge because it touches the edge of some of
our Member's most entrenched interests. It will therefore take a great
deal of political courage and commitment to conclude this Round
successfully. We are not very far from that success — but this is the
final stretch, and as in so many human endeavours, the last part is the
most difficult. I truly believe that this can be achieved, and I count
on the support of Mexico — and on the good vibes of its divinities.

Thank you.

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